No Progress in Setting up 100 Bil. Won Fund
Work to establish an investment fund to help Korean battery companies solidify their lead in the global market has virtually come to a deadlock. LG Chem and SK Innovation, which should take the initiative in establishing the fund, are currently at loggerheads over trade secrets.
In November last year, the Ministry of Trade, Industry and Energy (MOTIE) agreed with Korea’s three leading electric vehicle (EV) battery makers -- LG Chem, Samsung SDI, and SK Innovation – to create an industrial ecosystem for next-generation batteries. For this, the government and the three companies agreed to set up a battery fund amounting to 100 billion won, jointly develop next-generation battery technology and nurture promising small-sized businesses and venture startups.
In particular, the government originally planned to complete the establishment of the battery fund in the first quarter of this year. However, the companies have been reluctant to establish the fund. Furthermore, a spate of energy storage system (ESS) fires broke out, further delaying the establishment of the fund.
Most of all, a legal dispute between LG Chem and SK Innovation had a negative impact on the project. LG Chem claims that SK Innovation stole its core technologies by recruiting its former employees. SK Innovation argues that this litigation could cause leaks of the two companies’ patented technologies abroad as the lawsuit will proceed in a U.S. court. The dispute is expected to continue until a court ruling.
However, MOTIE says that the project has been somewhat delayed but there are no big problems. "We are currently in the process of establishing the fund and have no major problem," a ministry official said. "In the past, SK Innovation and LG Chem filed lawsuits regarding separators, but then they continued bilateral cooperation. In light of the past case, the two companies will join hands if they believe that the fund project will benefit them."